Canada proposes new fee structure

 - September 26, 2006, 1:39 PM

After 12 months of consultation with all segments of its domestic and overseas customer base, Nav Canada–Canada’s privatized air navigation service provider (ANSP)–has proposed a new fee structure that would mean slight reductions in terminal charges for large aircraft and slight increases for smaller aircraft. En route fees would be unchanged.

Nav Canada describes the fee changes as “revenue neutral,” meaning that they would not provide the organization with any more income but would bring the range of fees more in line with those imposed by ANSPs in other parts of the world. Nav Canada states that its large aircraft fees are currently among the highest in the world, while its corporate and general aviation fees are among the lowest.

The proposed changes are weight-based and run from an 8.4-percent (or $255) reduction for a 747-400 through zero percent for a 737-700 to a 5.6-percent ($14) increase for a Falcon 900 and a 10-percent ($11) increase for a Learjet 45.

Canadian Business Aviation Association president Rich Gage told AIN that while he and his staff are still studying the details of the proposal, it appeared at first sight to contain “nothing to be overly concerned about,” and that its general approach seemed to be “business as usual.”

Nevertheless, Gage cautioned that it did contain some subtleties that merited closer study before the association submitted its formal response by February 3, before the first changes take effect on March 1.

Proposed Fee Changes

The proposals are good news for general aviation operators of aircraft that weigh less than 6,600 pounds because the annual fees of $62 for aircraft weighing up to 4,400 pounds and $207 for those between 4,400 and 6,600 pounds will remain unchanged. These fees include unlimited access to all Nav Canada services, both VFR and IFR, without any additional charges.

However, Nav Canada has proposed an interesting, and some might say practical, incentive to encourage such general aviation operators to use reliever airports rather than Canada’s eight major fields at Vancouver, Calgary, Edmonton, Winnipeg, Toronto/Pearson, Ottawa, Montreal/Trudeau (formerly Dorval) and Halifax. Aircraft that weigh less than 6,600 pounds can use the airports, but they would be subject to a daily fee of $4.

The industry discussions that led to the current proposals covered many areas of concern, and Nav Canada has outlined its position on several of them in its announcement documents, available at www.navcanada.ca. They include:

• Certain charges are forecast to increase gradually in future years.

• Identical charges would be made regardless of location in Canada or the level of service offered (for example, towered versus non-towered airports).

• Charges for peak and off-peak periods would be the same.

• The per-flight rate for those using datalink would drop from $23 to $20, while the rate for those using voice only would increase from $45 to $53.

To offset unexpected traffic shortfalls while maintaining service, Nav Canada proposes to increase its rate stabilization account from $43 million to $65 million. Because the agency is a not-for-profit organization, payments into that account are made only when income exceeds expenditures.